Out of options, DISH finally pays TiVo $104 million judgment

DISH Network and EchoStar will finally pay TiVo $104 million over a patent …

DISH Network parent EchoStar has announced that it plans to pay $104 million to TiVo as part of a long-running legal dispute. DISH and EchoStar have reassured customers, however, that their DVRs will continue to function normally and that the patent-infringement finding would not affect the current DVR software the satellite TV provider is using.

TiVo originally won its patent infringement lawsuit against EchoStar in 2006, in which TiVo alleged that DISH infringed upon proprietary TiVo technology when the company designed its own DVR for the Dish Network. At the center of the clash was a patent for a "multimedia time warping system"—a patent so broad that many expected TiVo's victory to have reverberations throughout the DVR landscape.

As expected, the decision sparked a number of appeals from DISH, but TiVo won every appeal, with court after court deciding in favor of TiVo, and the US Patent and Trademark Office ruling that the patent was valid and enforceable. Throughout the process, DISH remained adamant that its DVR software didn't infringe on any TiVo IP, and even attempted to sue TiVo after it came up with a workaround so that it could be declared valid and noninfringing.

That brings us to today's announcement. DISH had appealed the original TiVo case all the way up to the Supreme Court, which denied the company's petition for certiorari (a petition to review the decision of the lower courts). As a result, DISH will pay out $104 million to TiVo—the original amount that the jury awarded in 2006, plus interest. "The money is in an escrow account and will be released to TiVo in the next few days," the company said in a statement issued today.

This decision does not affect the workaround that DISH has developed for its DVRs, though. That case is still ongoing, and a decision has yet to be made on whether the changes are enough to be noninfringing on TiVo's patents. "We believe that the design-around does not infringe Tivo's patent and that Tivo's pending motion for contempt should be denied," DISH said. "We look forward to that ruling in the near future." The company must be pretty confident in its workaround, because if that one doesn't pass the noninfringement test, then it may find itself being forced into a licensing agreement with TiVo in order to keep its own DVRs functioning.